Washington The number of Americans filing new claims for unemployment benefits fell sharply last week, additional evidence that employers continue to have trouble finding workers as the year draws to a close.
The Labor Department reported today that 274,000 Americans filed new claims for jobless benefits for the week ending Dec. 25, down by 9,000 from the previous week. That was the lowest level since Dec. 11, when claims were at 267,000.
Many analysts were expecting new claims to rise slightly to 285,000.
The four-week moving average for claims, which smoothes out week-to-week volatility, also was down last week to 279,750. That marked the lowest level since Dec. 15, 1973, when claims were at 256,750.
Economists consider jobless claims levels below 300,000 an indication of an extremely tight labor market, meaning it's difficult for some employers to find workers.
That's good news for workers but it's worrisome to economists and members of the Federal Reserve. Their shared concern: that employers scrambling to find scarce workers lure them with higher wages and benefits, increased costs that could drive up product prices.
Initial jobless claims have been running below 300,000 each week since early October.
The Federal Reserve has bumped up interest rates three times this year to slow the economy and keep inflation under control. One of the Fed's chief concerns is that the tight labor market could lead to wage and price inflation down the road.
Today's report also said that for the week ending Dec. 18, 23 states and territories reported decreases in new jobless-claims applications, while 28 reported increases. The state data lag one week behind the national figures.
The state with the biggest decrease in claims was Georgia, down 3,700. Officials attributed the decline on fewer layoffs in the textile industry.
Other states with big declines were: Arkansas, down 2,226; Alabama, down 1,734; South Carolina, down 1,476; and Tennessee, down 1,119.
The state with the biggest increase was Virginia, up 4,547. Officials blamed the increase on layoffs in the textile and tobacco industries.
Other states with big increases were: Michigan, up 2,662; Ohio, up, 2,360; Wisconsin, up 2,191; and Missouri, up 2,015.
With jobs plentiful and stock prices soaring, consumer confidence rose in December.
And, in a report Wednesday, a key measure of the economy's future performance rose 0.3 percent in November, signaling the economic expansion will continue well into 2000 as the longest in U.S. history.